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Returning Member
posted Mar 17, 2022 3:25:36 AM

How to enter Fair Fund Distribution with no 1099 tax form

I received a settlement (Fair Fund Distribution) from Valic for breaching its fiduciary duty to its clients. The 403k account has been closed for almost 5 years and I am over 60 years old now. The total distribution is $650, $100 was remediation-interest and $550 was remediation principal. The settlement noted that distributions amounts with an interest component less than $600 will not receive any tax form. I can create a 1099-int for the interest portion. For the remediation principal. I am willing to treat the entire amount as regular income, but without a tax form how do I enter this into turbotax and where would I get the necessary information?

0 3 1523
3 Replies
Level 15
Mar 17, 2022 4:03:37 AM

All of it can be reported as one amount since it is all taxed the same. 

 

Follow these directions :

  • Down the left side of the screen, click Federal.
  • In the center of the screen, click Income & expenses.
  • On the screen Your income and expenses, scroll all the way down to the last section, Less Common Income.
  • Click the Start or Update button for the last topic, Miscellaneous Income, 1099-A, 1099-C.
  • On the next screen, Let's Work on Any Miscellaneous Income, scroll down and click the Start or Update button for the last topic, Other reportable income.
  • The next screen asks, Did you receive any other taxable income. Click Yes.
  • On the next screen, Other Taxable Income, enter a description and the amount. Click Continue.
  • On the next screen click Done.

The income will be reported on Schedule 1 line 8 with the description that you entered. 

Returning Member
Mar 20, 2022 12:42:15 AM

I have already entered the interest portion in the 1099-int section and then the principle in the Other Taxable Income section you mentioned. Will this work or should I have entered the total amount in Other Table Income section.

 

I seems that both methods would yield the same resulting taxes. However, I am not sure if my way would add any confusion?

Level 15
Mar 20, 2022 4:11:06 AM

Either way is fine ... it is all taxed the same in the end.